We’re at the 8th of June right now and Abu Dhabi starting to open up. So what’s going on for the landlords and tenants right now? The market is still very sticky and stagnant. There’s not a lot of people moving. We still don’t have commercial flights so people aren’t able to go out of Abu Dhabi or back in, and people are still nervous about moving because we are still getting some coronavirus cases.
How does that affect landlords and tenants?
For landlords with a sitting tenant it is quite positive. Lots of tenants are renewing. They don’t have a lot of negotiating room. They are renewing for three months or maybe even a year. So landlords are often getting very good renewal prices.
For tenants it is pretty tough at the moment. Obviously if you are a tenant and you want to move there is a not a lot of availability out there because a lot of people are just renewing and there is not much to churn in the market. What availability is out there is usually pretty well priced because there aren’t many tenants looking at the moment.
So if you are a tenant who is looking you probably won’t have a lot of choice but it probably will be quite priced. If you are a landlord with a sitting tenant you’ve got a very good chance that the tenant is going to renew at least for some period.
If you are a landlord with an empty unit, for the same reasons there’s not many tenants out there. There’s not many people looking to move so you are going to need to be quite proactive about your pricing, and about your marketing. Now what’s going to happen when things do open up, when we do get flights in and out of the country? When people are less worried about the coronavirus? It is unclear what is going to happen then.
Obviously, there’s going to be job losses, we don’t know what those will look like at the moment, but we imagine that the trend in lower rents will continue at least for the foreseeable future.